An energy hedge fund managed by Boston’s Loomis Sayles has managed to generate alpha from the short side of its equities portfolio. The fund’s portfolio managers believe that high prices of energy stocks have created an environment where “many companies are priced to perfection and susceptible to disappointing surprises in the future,” says an e-mail penned by the firm’s third-party marketer. The Loomis Sayles Energy Hedge Fund is managed by James Carroll and Larry Shaw and seeks to minimize the volatility usually associated with the energy market. Its investment universe, which tracks 650 companies, is broader than most energy hedge funds: “companies involved in the exploration, production, refining, marketing or distribution of energy and natural resources as well as transportation companies, equipment manufacturers, utilities and other companies that support energy companies or consume or otherwise depend on energy products.”
Since its Oct. 12, 2005 launch, the fund has returned 14.66% with only one losing month this February. In June, it returned 45 basis points.